On 22 August 2020 Minister of Finance, responding to the parliamentary interpelling 9368, points out that the dividend payment does not fall within the definition of controlled transaction and is not subject to the obligation to draw up tax records.
On the grounds of its position, the MF pointed out that the definition of a controlled transaction, as adopted in the Income Tax Act, emphasizes the economic nature of the parties' activities, which should be understood as a commercial activity. The single economic activity undertaken for a profit consists of economic activity.
In the opinion of the MF, the dividend payment act itself should not be seen as such an economic activity. It is an activity which involves the functioning of companies which is undertaken on the basis of the provisions of the Commercial Companies Code.
The dividend is the implementation of the distribution of the profit generated by the company, which is the consequence of the company's business activity, while this is not an economic independent activity, thus not covered by the definition of a controlled transaction.
The position presented by the MF should be assessed positively. This interpretation may help to remove the uncertainty that many taxpayers are currently facing about the possible dividend documentation obligation.
The definition of a controlled transaction in the current legislation is very broad and allows for a certain discretionary approach to certain events. In our opinion, both in the current state of the law and in the earlier one, the dividend should in no case be treated as a transaction resulting in a tax obligation.
Written by Leszek Dutkiewicz, partner of Russell Bedford Poland. Associated with the company from 2011. Director of RBP office in Katowice. In years 2008 – 2011 worked for leading consulting companies (Ernst&Young, KPMG, BDO) providing tax advisory services.
He specializes in tax and economic law, primarily in international tax law, tax proceedings, VAT and transaction prices. Author of a publication on tax, civil and international law issues. Lecturer in tax law training. He has legal education, in 2008 graduated from the Faculty of Law and Administration of the Jagiellonian University.